NEW YORK, May 19, 2016 /CNW/ - This week George Soros, a legendary investor, disclosed he purchased $264 million worth of shares in Barrick Gold and 1.1 million options to buy SPDR Gold ETF. But the "man who broke the Bank of England", is not the only one with bullish views on Gold. Last week at the Ira Sohn Investment Conference in New York, Stanley Druckenmiller, a famous American hedge fund manager and the former Chairman and President of Duquesne Capital, gave his opinions and suggestions regarding the near term future of the stock market. His message was simple enough - get out of the stock market and buy gold. Brazil Resources Inc. (BRI.V), Kinross Gold Corporation (K.TO), Newmont Mining Corp (NYSE: NEM), Agnico Eagle Mines Ltd (AEM.TO), Direxion Shares Exchange Traded Fund Trust (NYSEARCA: NUGT)
According to Stanley Druckenmiller, "The bull market is exhausting itself… The Fed has borrowed from future consumption more than ever before. It is the least data dependent Fed in history. This is the longest deviation from historical norms in terms of Fed dovishness than I have ever seen in my career."
When big names in the finance world give their advice many follow, and yet this week hasn't been particularly good for gold investors. On Wednesday Federal Reserve officials reaffirmed that a rate hike is possible this coming June. In a meeting that was clearly meant to push back against analysts' who claim that another rate hike is unlikely. The Fed's confidence in the economy caused gold prices to drop. Shares of the Direxion Shares Exchange Traded Fund Trust (NYSEARCA: NUGT) fell about 24% by the end of the day after the FOMC minutes were released.
Yet the stock market indexes rebounded intraday and closing slightly green or flat. Michael Hartnett, a chief investment strategist at Merrill Lynch, indicated many investors are very bearish and nervous about a "summer of shocks." Gold remains an attractive buy in the eyes of investors as a protection against a volatile market. As a result the gains that some gold companies have witnessed are quite astonishing.
Junior Gold Miners like Brazil Resources Inc. (TSX-V: BRI), had a stellar 2016 so far. Shares have surged as high as 230% since the beginning of the year. Brazil Resources focuses on the acquisition and development of projects in emerging producing gold districts in Brazil, Paraguay and other regions of the Americas. Brazil Resources
Brazil Resources Inc. management claims that there are unprecedented acquisition opportunities in the markets today, and Brazil Resources is in a position to take full advantage of highly accretive transactions. Currently the company has a portfolio of nine projects.
Other sector companies mentioned, Kinross Gold Corporation (TSE: K) is engaged in gold mining and related activities, including exploration and acquisition of gold-bearing properties, the extraction and processing of gold-containing ore, and reclamation of gold mining properties. The company operates in mines is located in Alaska, Nevada, Chile and Brazil. The stock of has risen by 182% this year.
Newmont Mining Corp (NYSE: NEM) a global mining company, which is focused on the production of and exploration for gold and copper. The Company is primarily a gold producer with operations and/or assets in the United States, Australia, Peru, Indonesia, Ghana and Suriname. It has gold reserves of over 73.7 million ounces and an aggregate land position of over 20,000 square miles. Investors gained more than 85% since the beginning of the year.
Agnico Eagle Mines Ltd (TSE: AEM) is a Canada-based gold producer. The Company has mining operations in northwestern Quebec, northern Mexico, northern Finland and Nunavut, and exploration activities in Canada, Europe, Latin America and the United States. It operates through three business units: Northern Business, Southern Business and Exploration. Shares of the company increased in value by more 75% year to date.
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